DLax85

Tony C - I whole heartedly agree with your entire post!

I’ve said many times working 5 more years doesn’t extend your longevity 5 more years, I’ll venture to guess it decreases it

It’s also become apparent, that the majority of those with maxed high 5 and 25 years of service are working very close to age 65.

Not my plan, and I don’t care what they do - and I’m in no way suggesting we agree to a higher, penalty free, “retirement” age. Keep our CBA defined “retirement age” at 60!

I agree the simplist way to increase our total retirement benefits is to increase current cap in our current DEFINED Benefit plan

But, what will the company agree to?

A higher cap, only if we switch to a Variable Benefit Plan?

Perhaps, a higher cap tied to max wide body captain or narrow body captain x 1,000 hours...??

We need a mechanism in place to automatically raise the cap without constantly renegotiating it. Tying the cap to max captains pay x 1,000 hours seems very reasonable.

At current pay rates, I believe that would yield a cap of $304K or $262K

(Remember we are stuck at $260K now due to our own past inaction)

If the company only agreed to the start indexing the rate at the lower $262K, can we make up the ground by negotiating a bigger B fund?

Since the union leadership now knows/better understands the company’s A fund costs, it is possible to calculate an equivalent B fund value

Indexing the A fund cap and increasing the B fund percentage (with cash over cap) would fulfill both company goals and pilot goals

Such a hybrid approach doesn’t increase pilot risk in terms of A fund payouts, and lets each pilot control their level of B fund risk in accordance with their own individual needs.

While no system is perfect, I think it would minimize inequities and fairness issues associated with freezing the current A fund benefits, and starting anew under a Variable Benefit Plan


Once again, let’s think broadly & critically, and demand our union representatives, retirement committee and negotiations team do the same

In Unity,

DLax

FamilyATM

DLax you state:
“It’s also become apparent, that the majority of those with maxed high 5 and 25 years of service are working very close to age 65.”

I’m not sure that statement is fact based. I’m 57,been here 27 years, have my high five and just waiting to turn 60 to retire. If I were to retire before 60 I lose 5% a year for every year between 55 and 60. Also there are 110 crew members senior to me that are younger than me (ALPA retirement calculator and the old FedEx seniority list they use to show us back in the 90’s). So no, we are all not waiting to run the court and go till 65.

TonyC

You describe one of the dozens of demographic subgroups which I referenced above. Seniority and age are not equal.

I believe your particular subgroup would benefit by removing the penalty for "early" retirement, and I can't think of a reason anyone should oppose that.






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angry tanker

First - Nakazawa, hope retirement is treating you well! Best wishes to you and the family.

Second - Tony C and Dlax have both said what I was trying to allude to before. Don't mess with my ability to get out at 60. Stop incentivizing this game so guys stay longer than they need to.

I understand everybody has different life situations. Hired young, hired old, married once, five times...whatever. Our retirement program has to have a point where it is done...25 yrs of service and age 60 is that point. Hit either early or late, I'm sorry, this was the compromise. So now guys that don't have the 25 have the option to work till 65. The guys that get 25 yrs of service before 60, either enjoy the seniority for a few years, retire and take the hit, or retire and delay receiving your cut till you are 60 (Walmart Greeter). There are better options out there than taking all the risk.

iarapilot

Aint that the truth.

FXLAX

Bare with me, I’m just trying to understand. But how is providing an additional 1% multiplier for years of service over 25, giving the company something in return? Doesn’t that also increase their costs and therefor how is it any different than what I proposed? They both increase cost. The difference being that your idea incentivizes (in even if not overly so, as you put it) pilots to stay beyond 60 and my idea doesn’t. I keep reading on this forum how having pilots retire at normal retirement age as opposed the lawful age as being a desired side effect of the A plan.

How does it penalize those hired younger than 40? Everyone gets to the 50% threshold quicker! No one loses out that way. You say that pilots would work five more years without any pension gain. But that’s no different than someone getting hired at 30 as opposed to 35 in this status quo. The 30 year old will have five more years than the 35 year old with no pension gain. If more pilots retires at the normal retirement age with a 50% pension, how does that hurt any other pilot who was already on that track? An extreme example would be a 5% multiplier with a maximum of 10 years. Would you be agains that as well just because you will work an additional 15 years without any gains to the pension that you would not gain from with the status quo anyway? I was under the impression that lowering the YOS to get to the maximum benefit is a good thing for everyone.

TonyC

While we've been told that The Company has given The Association "retirement data", we, the membership, haven't really been given much information. Which costs The Company more, getting the top-paid pilot off the payroll and into retirement, generating a training cycle which generates another and a whole cascade of training cycles, OR having the top-paid pilot work one more year, taking all of his vacation, delaying the cascade of training cycles, and delaying retirement payoffs?

It's fun to speculate, but who really knows? The "One More Peak or Fly 'Til You Die" retirement incentive might indicate it's cheaper to keep the top-paid pilot on the payroll one more year with the twist that he's enticed to NOT take his vacation.

If -- emphasis on IF -- IF it's cheaper to keep the top-paid pilot rather than pay to replace him, the additional multiplier or additional years of service beyond 25 might be another way to entice them to stay.


I'm not advocating that approach, only explaining why The Company might agree to it. Again, at this point, we can only speculate about various and relative costs and benefits of retiring versus working one more year, so it can only be considered a possibility.

Frankly, I believe that kind of information is more important and useful to us than what we have spent hundreds of thousands of dollars to learn about alternate variable plans.




The Membership SHOULD determine the priorities. It's a priority which I strongly support, and which has served as the bedrock of previous negotiations. It's hard to tell lately what priorities the MEC are using.







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pinseeker

Your idea hurts the guy who got hired younger than 40 because the company's funding requirement increases on a yearly bases with your idea. Who pays for that? If we are going to have the company pay more every year, which we should, why not simply increase the cap, which will help everyone. Your plan only helps those who can't work 25 years for FedEx. My guess is that you can't put in 25 years and this solves YOUR problem. Tell me how your idea helps the guy that got hired at 30.

pinseeker

FXLAX,

Let's put this another way.

Let's say it take $2.3M to get $130K for life. At a 6% rate of return for 25 years, it takes an investment of about $40K per year to reach that total.

Now let's change the time frame to 20 years with the same target amount and rate of return. Now you need to invest $60K per year to reach that $2.3M total that is requires to get $130K for life. That is a 50% increase in funding.

So what you are asking is that if I got hired at 30, the company now increases its yearly contribution to retirement by 50% so that I don't get any increase so a guy who got hired at 45 can get the same retirement as I get. That guy works 20 years to age 65 and gets the same A plan retirement as the guy who has to work 30 years or take a penalty and get less. How is that fair for everyone?

So to answer your question above, NO, your idea isn't better for everyone.

FXLAX

Thanks for that. It makes sense to me now.